Mortgages and unused credit cards

MovingForwards

I've commented on your other one.

Anyanka1

That's me told, ACG!    I only figured out the taking a builder with you thing late on in the process and we just happened to get a really good guy but I take your point.

ACG

Sorry, I am one of those annoying people - what is in my head comes out of my mouth. I just believe in getting things said, argue it out and then have a hug and move on, not that we have argued or that I am after a hug but... I will just get my coat. 

I suppose the point I am making is that tradesmen can be very hit and miss and they are in no way going to cover any losses for missed issues. Surveyors on the other hand despite the backside covering are liable for missed problems (providing it is something within the scope of the survey). 

superM

I also had allot of available credit may be around 40 to 50k. I didn't had problems obtaining mortgage with NatWest or Nationwide. 
A while back I read online Yorkshire BS takes into account the available credit when assessing application. 

ACG

All lenders take into account available credit. 
I had a case declined with natwest last week - one of the reasons (there were several) was due to "over exposed credit facilities" - basically the bloke could have bought a small house using his credit cards if he had wanted to. 

samps1973

Yeah, I think I ill get rid of most of the cards apart from 3 of the best ones and have £15 -20k available credit. Not that I'd ever want to use that much. I know that if you use over 25% utilisation on any card it effects your credit score. So on 20k that's £5k w only spread over 3 cards to use on emergencies.

With the lender that I'm going to use, there's 6 mortgages I can choose from. I need to do the illustrations on all 6 to see which is cheapest. Theres 4 × 2 year fixed rate ones and 2 × 5 year fixed.
I think the best one is fixed at 3.05% for 2 years then it changes to 3.59% I'll also get £500 cashback when the mortgage is completed. I've had a look around on the comparison sites and the deal seems fair, I know theres probably cheaper out there marginally but I feel it's easier to use the people I bank with. In total if I wasnt going to make overpayments it will cost £200k for a £142k mortgage...Being able to make overpayments is the biggest thing for me at my age and the way forward.

Thanks

MovingForwards

The credit score you see is not the same lenders see as they have their own internal algorithm methods for scoring applications.

1. Some lenders don't have that good a rate for renewing another fix, after the original one is up. Your options are pick one or remortgage to another lender.

2. Also check how much the early repayment fees (ERCs) are, just in case there's a change in circumstances during your fix eg fantastic job opportunity elsewhere, lotto win or other windfall, payrise or job change leading to increased salary or relationship to enable a different property purchase and sale of current one.

I did a 5 year fix as I wanted the option of remortgaging early, at the same time knowing for 5 years I'm paying X per month or XY due to overpayments. I wanted convenience and ease of planning.

With the ERCs I'm saving a bit each month to pay them, plus a bit for remortgage costs.
- If I remortgage early, they are in the bank.
- If I go the full 5 years that's the remortgage costs covered and a slice off the outstanding mortgage. 

ACG

samps1973 said:

With the lender that I'm going to use, there's 6 mortgages I can choose from. I need to do the illustrations on all 6 to see which is cheapest. Theres 4 × 2 year fixed rate ones and 2 × 5 year fixed.
I think the best one is fixed at 3.05% for 2 years then it changes to 3.59% I'll also get £500 cashback when the mortgage is completed. I've had a look around on the comparison sites and the deal seems fair, I know theres probably cheaper out there marginally but I feel it's easier to use the people I bank with. In total if I wasnt going to make overpayments it will cost £200k for a £142k mortgage...Being able to make overpayments is the biggest thing for me at my age and the way forward.

Thanks

That is a bit of an unusual way to do things. 
Do you want a 2 year or a 5 year deal? You are not comparing the total cost because an illustration will assume that you do your 2 or 5 year fixed rate and then you sit on the SVR for the other 20-30 years and that SVR does not change in that time - neither of which will happen. 

You need to decide if you want a 2 or 5 year deal. Are you planning on moving? Do you want the extra security a 5 year fix offers and are you happy to pay the higher rate to get that? Do you plan on extending or doing work where you will want to pull money out down the line or are there any plans to over pay?
Lots of things to decide but doing 4 illustrations to compare the cost is not really worth it as you are comparing apples with oranges. 

samps1973

And there was me thinking I've got the hang of this now 😅. I only started looking into mortgages a couple of weeks ago and haven't got a clue tbh.

I made a mistake. I worked out the total if the vr had stayed the same just so I could see the difference in the total price over the years as a guide. I thought there was a £4000 difference between the 2 and 5 year fr deal but its actually  only £400 more over all them years for a 5 year fixed rate mortgage if that makes sense 🤔

So, yeah I would definitely prefer the 5 year fixed one for security and so it's easier to keep the Bill's in order and know what I can over pay for them 5years. The rate is a bit higher, instead of 3.05% its 3.39% over 5 years. Complicated stuff!

Another worry has popped up today. I think the bank will need 3 months pay slips. Although I'm not sure as I bank with them. I'm assuming obviously that it's to confirm what I earn. Like I said I only started thinking about getting a mortgage very recently. I'm going to get the credit cards sorted so theres not as much credit available. 
As I rent and have some disposable income I spend money here there and everywhere normally. Not crazily, but I buy things like takeaways, things from amazon, I'm guessing what most people do really. Do they go through every single transaction and work things out that way?
I'm not stupid with money, I've just had no reason to be careful really but obviously having a mortgage is a big commitment and I would need to budget properly and know where every pound is going. 

Will I be better off polishing up my account over the next few months/statements to make it look better? Although I don't really want to as its wasting more time. I have nothing to hide but if they see I've been a bit willy nilly with the spending they may have second thoughts and I can't explain to them like I can explain it to you guys.

I wouldn't normally think like this but its not a few thousand it's a lot of money.

I though maybe just go for it and see what happens. My score on experian is 999 but like Movingforwards said they have their own internal score.

Thanks 

Anyanka1

Sorry, samps1973 but this is for ACG:  Sending you a hug if you need it and thanks for all the advice over the years.  I tend to say whatever comes into my head as well so...
Samps1973, please let us know how you get on.  Too many times we never hear the end of the story, not that this is only entertainment to us but you know what I mean, right?